Financial Math Study Guide for Test 2

What is one real advantage of having a credit card?

• There is no real advantage.

• Establishing a credit score.

• Renting a Car.

• Easy to use.

What is the range of a GOOD credit score?

• 720-760

• 700-850

• 350-500

• 700-800

What is the range of a GREAT credit score?

• 720-760

• 700-850

• 760-800

• 700-800

What is the maximum percent of your monthly gross income you should have set aside to pay debt payments?

• 10%

• 24%

• 30%

• 36%

What are the advantages of having good credit?

• Higher interest rates on loans, lower chances of loan approval, limited credit card offers, inability to negotiate better terms on loans, and limited financial opportunities.

• No impact on interest rates on loans, no impact on chances of loan approval, no access to better credit card offers, inability to negotiate better terms on loans, and limited financial opportunities.

• Lower interest rates on loans, higher chances of loan approval, access to better credit card offers, ability to negotiate better terms on loans, and improved financial opportunities.

• Higher interest rates on loans, lower chances of loan approval, limited credit card offers, inability to negotiate better terms on loans, and limited financial opportunities.

Which of the following is not a type of debt that is available to individuals?

• Credit Card

• Mortgage loan

• Business loan

• Pay in 4

True or false: You do not have to carry car insurance if your car is paid for.

• True

• False

The five basic types of savings and investing are: Savings accounts, certificates of deposit, Christmas club, mutual funds and EFT's.

• True
• False

The five basic types of savings and investing are: Savings accounts, certificates of deposit, bonds, stocks, and mutual funds.

• True
• False

Of the fives basic types of savings and investing account, Which is the riskiest?

• Christmas Club Savings

• Pacific Railroad Corporate Bond

• Ford Motor Credit stock

• Putnam Investors Mutual fund (general fund)